Central Bank of Tunisia Circular No. 2018-10 to Banks dated November 1, 2018

Tunis, November 1, 2018
CIRCULAR TO BANKS NO. 2018-10
Subject: "Credits/Deposits" Ratio

The Governor of the Central Bank of Tunisia,
Having regard to Law No. 2016-35 of April 25, 2016 establishing the status of the Central Bank of Tunisia; Having regard to Law No. 2016-48 of July 11, 2016 on banks and financial institutions; Having regard to Circular No. 2017-06 of July 31, 2017 on accounting, prudential and statistical reporting to the Central Bank of Tunisia; Having regard to Circular No. 2006-19 of November 28, 2006 on internal control; Having regard to Opinion No. 08-2018 of the Compliance Control Committee dated October 19, 2018, as provided for in Article 42 of Law No. 2016-35 of April 25, 2016 establishing the status of the Central Bank of Tunisia.

Decides:

Article 1
This circular aims to establish a "Credits/Deposits" ratio, as defined by the provisions of Article 3 below, ensuring better alignment between resources and uses and managing maturity transformation risk.

Article 2
Banks whose "Credits/Deposits" ratio exceeds 120% at the end of a given quarter must take necessary measures to reduce their ratio by the end of the following quarter, under the following conditions:

Quarterly Ratio	Reduction to Apply
Credits/Deposits ≥ 122%	2%
120% < Credits/Deposits < 122%	Percentage required to bring the following quarter's ratio down to 120%

Article 3
The "Credits/Deposits" ratio is defined as the ratio between the following numerator and denominator:

Numerator	Denominator
Gross outstanding customer credits in dinars	Sum of the following elements: <br> - Outstanding deposits and customer balances in dinars after deduction of other amounts due to customers, <br> - Outstanding deposit certificates, <br> - Any other form of loans in dinars and foreign currencies, excluding bond loans and money market loans.

Banks must submit their "Credits/Deposits" ratio statement to the Central Bank of Tunisia in accordance with Annex 1 of this circular.

Article 4
Any bank failing to comply with Article 2 of this circular for a quarter must submit to the Central Bank of Tunisia, no later than 10 days after the declaration for that quarter, an action plan detailing measures to correct its position regarding the regulatory ratio set forth in Article 2.

Notwithstanding the provisions of paragraph 1 of this article and in application of Articles 169 and 170 of Law No. 2016-48, any bank exceeding the provisions of Article 2 is subject to a fine calculated according to the following formula:
AT = (ET * 1% * nT) / 360
AT: Fine amount,
ET: Amount of credits exceeding the target quarterly ratio, nT: Number of days in the quarter considered.

Article 5
Annex I to Circular No. 2017-06 on accounting, prudential and statistical reporting to the Central Bank of Tunisia is amended by adding declaration RPLT560 "Credits/Deposits Ratio" to sub-domain 2 "Liquidity Risk" of domain 3 "Prudential Reporting", in accordance with Annex 2 to this circular.

Article 6
The provisions of this circular take effect starting from the last quarter of 2018, based on the "Credits/Deposits" ratio at the end of September 2018.

THE GOVERNOR
Marouane EL ABASSI

Annex 1 to Circular No. 2018-10
Bank: Calculation elements of the "Credits/Deposits" ratio as at .......
(In thousands of dinars unless otherwise stated)

Code	Label	Quarter T-1	Quarter T
AC030000000000	Customer credits in dinars (1)
PA030000000000	Deposits and customer balances in dinars (2)
PA030900000000	Other amounts due to customers in dinars (3)
PA040101000000	Deposit certificates (4)
PA040300000000	Special resources in dinars and foreign currencies (5)
PA020102010900	Other loans of non-resident banks established in Tunisia in dinars and foreign currencies (6)
PA020102020900	Other loans of non-resident banks established abroad in dinars and foreign currencies (7)
PA020101090000	Other loans of resident banks in dinars and foreign currencies (8)
PA040209000000	Other loans contracted in dinars and foreign currencies (9)
Denominator (10)=(2)-(3)+(4)+(5)+(6)+(7)+(8)+(9)
"Credits/Deposits" Ratio (11)=(1)/(10) (%)	(12)	(13)
Target quarterly ratio (%)	(14)
Excess of credits ((13)-(14))*(10)

Annex 2 to Circular No. 2018-10 amending Annex I to Circular No. 2017-06 on accounting, prudential and statistical reporting to the Central Bank of Tunisia

Domain	Declaration Code	Declaration Title	EA	Declaration Frequency	Maximum Transmission Deadline	Format /Transmission
3-Prudential Reporting	SD 2-Liquidity Risk	RPLM47 Liquidity Ratio (Circular 2014-14)	BR	Monthly	DR+10j	XML
	RPLA510 Breakdown of assets and liabilities in dinar by remaining maturity	BR	Annual	DR+45 j	XML
	RPLA520 Breakdown of assets and liabilities in US Dollar by remaining maturity	BR+BNR	Annual	DR+45 j	XML
	RPLA530 Breakdown of assets and liabilities in Euro by remaining maturity	BR+BNR	Annual	DR+45 j	XML
	RPLT540 Concentration on the top 50 depositors in dinar	BR	Quarterly	DR+30j	XML
	RPLT550 Concentration on the top 50 depositors all currencies combined	BR+BNR	Quarterly	DR+30j	XML
	RPLT560 Credits/Deposits Ratio (Circular 2018-……)	BR	Quarterly	DR+30j	XML